China Drone Maker Expects to Double Sales on Islands Dispute

China Aerospace Science & Industry
Corp., the nation’s biggest maker of non-military drones,
expects to double unmanned aerial vehicles sales next year as
sovereignty disputes spur government orders.
The country intends to increase monitoring at sea amid a
row with Japan about the ownership of islands in the East China
Sea, Huang Xingdong, deputy head of CASIC’s drone-making arm,
said in a Nov. 13 interview at the Zhuhai airshow. The state-
owned company signed an agreement to supply an undisclosed
number of drones to an oceanic agency at the expo.
“The government is attaching greater importance to ocean
intelligence gathering as the islands disputes heat up,” Huang
said. He declined to give an exact sales forecast. The company
also makes missiles and parts for China’s space program.
Aviation Industry Corp. of China, the nation’s largest
aerospace company, separately debuted the armed Wing Loong UAV
at the show, as China translates economic growth into increasing
military might. The country, the biggest spender on defense
after the U.S., began sailing its first aircraft carrier this
year and it’s working on more sophisticated fighter jets, naval
vessels and cyberwarfare technology
CASIC showcased six civilian and military drones at the
Zhuhai show, and unveiled a new brand name, Hiwing, which means
Sea Hawker in Chinese. Its UAVs can fly as fast as 700
kilometers per hour (435 miles per hour) and carry as much as
130 kilograms (287 pounds).
The company sold several dozen UAVs in the past few years,
with prices ranging from less than 1 million yuan ($160,000) to
about 10 million yuan, Huang said. The local non-military UAV
market may eventually grow to as big as several billion yuan
a year, he said. He didn’t give an estimate for defense sales.

‘Upward Cycle’

“The China drone market is not big, but it’s starting an
upward cycle,” Huang said. The company also announced an order
from a government surveying agency at the show.
The dispute over East China Sea islands caused China’s
relations with Japan to reach their lowest since at least 2005
in September. Demonstrators marched in cities across China and
attacked Japanese businesses after Japan’s government bought the
islands from a private owner.
Xi Jinping yesterday replaced Hu Jintao as the head of
China’s Communist Party and as chairman of the party’s Central
Military Commission. Japanese Prime Minister Yoshihiko Noda
plans to dissolve parliament today, triggering elections that
polls indicate will be won by former Prime Minister Shinzo Abe,
who advocates a tougher stance in the territorial dispute.
To contact Bloomberg News staff for this story:
Jasmine Wang in Hong Kong at
jwang513@bloomberg.net
To contact the editor responsible for this story:
Neil Denslow at
ndenslow@bloomberg.net